Staff recommends that the City Council adopt a resolution approving a fee deferral for the 2700 N. Hayden Parkway, Fiddyment Ranch F-8A Apartments Project consisting of a 330 affordable residential unit apartment complex in an amount not to exceed $4,889,723.52, plus interest, until final of building permit/building occupancy.

The City of Roseville offers a fee deferral program through the Economic Development Department as an incentive to encourage development.  The Fiddyment F-8A Apartment Complex is requesting a fee deferral of certain City-controlled development impact fees.  The fee deferral requires City Council approval and that development impact fees are paid prior to the issuance of a Certificate of Occupancy/Building Permit Final, as applicable to each permit.   

The Economic Development Department received a request from Maracor Development on June 6, 2022 requesting approval of a fee deferral for the Fiddyment Ranch F-8A Apartment Complex, see Attachment 1 for address details of Maracor Development.  The Fiddyment Ranch F-8A Apartment Complex ("Complex") is located within the West Roseville Specific Plan area and is located at 2700 N. Hayden Parkway.  The Complex proposes construction of 330 residential units within 11 buildings, a club house, pool, site parking and play areas, see attached plans. All units within the complex will be provided as affordable units.

A fee estimate has been prepared for the Complex based on the fees for Fiscal Year (FY) 2022-23. The City fee types and amounts eligible for deferral are identified below:

The total amount of deferrable fees could change if building permits are pulled after FY2022-23, however the list of deferrable fees would not change following Council action on this item.

According to the Roseville Municipal Code (RMC) all non-residential fee deferrals greater than $100,000 dollars are required to be approved by the City Council.  The typical construction and inspection timeframe for apartment complexes is 12-24 months.  In an effort to cover lost interest resulting from the City fee deferral there is a pooled interest charge of 1.25% that will be paid upon issuance of a Certificate of Occupancy or Building Permit final.  The RMC additionally identifies an administrative processing fee of $831 to be charged per building permit to cover staff's time of processing requests. This report constitutes the written report required by Government Code Section 53083.

The requested deferral itself will not result in a loss of impact fees nor earned interest income. The development impact fees are required to be paid prior to issuance of building permit final or occupancy.  To ensure that the City will not have loss of interest income, the Roseville Municipal Code requires an interest rate be charged on monies deferred.  Specifically, the City's Finance Department identified that the City's ten-year average pooled interest rate is approximately 1.25%.  Therefore, an interest rate of 1.25% will be charged on the monies deferred to cover the City's cost of the loss of interest income on the fee deferral amounts.  Additionally, the Roseville Municipal Code identifies an administrative processing fee of $831 to be charged to each building permit(s).  

The City's fee deferral program is an important economic development tool that facilitates new development that may not otherwise be financially feasible without this program.  As a result, this program has the potential to increase impact fees and investment that directly increase property values that may not otherwise occur if this program was not available. Construction of this housing development will create approximately 65-150 temporary construction jobs and approximately 4-10 permanent full and/or part time jobs.

Goal C. Maintain a safe and healthy community – Addressing homelessness is a Council goal. The Fiddyment Ranch F-8A complex is being proposed as a 100% affordable rental project and will provide 330 rental units.  The developer will be providing deeper income targeting and will offer 33 units for extremely low (30% AMI), 66 units for very low (50% AMI), and 227 for low-income (60-80% AMI) households. Additionally, this project will help the City meet its required Regional Housing Needs Allocation (RHNA) for affordable units.

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Dominick Casey, City Manager